MUNJALAU.NS WACC - Weighted Average Cost of Capital
The WACC of Munjal Auto Industries Ltd (MUNJALAU.NS) is 15.2%.
| Range | Selected | |
| Cost of equity | 17.6% - 20.4% | 19% |
| Tax rate | 27.0% - 31.5% | 29.25% |
| Cost of debt | 8.1% - 10.9% | 9.5% |
| WACC | 14.0% - 16.5% | 15.2% |
| Category | Low | High |
| Long-term bond rate | 6.9% | 7.4% |
| Equity market risk premium | 8.3% | 9.3% |
| Adjusted beta | 1.29 | 1.35 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 17.6% | 20.4% |
| Tax rate | 27.0% | 31.5% |
| Debt/Equity ratio | 0.44 | 0.44 |
| Cost of debt | 8.1% | 10.9% |
| After-tax WACC | 14.0% | 16.5% |
| Selected WACC | 15.2% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| MUNJALAU.NS | Munjal Auto Industries Ltd | 0.44 | 1.27 | 0.97 |
| ALICON.NS | Alicon Castalloy Ltd | 0.21 | 1.31 | 1.13 |
| BANCOINDIA.NS | Banco Products (India) Ltd | 0.04 | 1.29 | 1.25 |
| DYNAMATECH.NS | Dynamatic Technologies Ltd | 0.12 | 1.28 | 1.18 |
| FIEMIND.NS | Fiem Industries Ltd | 0 | 1.09 | 1.08 |
| GNA.NS | GNA Axles Ltd | 0.18 | 1.1 | 0.97 |
| LUMAXTECH.NS | Lumax AutoTechnologies Ltd | 0.1 | 1.16 | 1.08 |
| PRICOLLTD.NS | Pricol Ltd | 0.01 | 0.83 | 0.83 |
| RICOAUTO.NS | Rico Auto Industries Ltd | 0.67 | 1.91 | 1.28 |
| RML.NS | Rane (Madras) Ltd | 0.3 | 1.79 | 1.47 |
| Low | High | |
| Unlevered beta | 1.08 | 1.15 |
| Relevered beta | 1.43 | 1.52 |
| Adjusted relevered beta | 1.29 | 1.35 |
MUNJALAU.NS's CAPM model and how its cost of Equity is calculated
The Cost of Equity reflects the return a company needs to deliver to shareholders to justify the risk of investing in its shares. It’s computed using the Capital Asset Pricing Model (CAPM), which blends the risk-free rate, the stock’s beta, and the market risk premium.
This method evaluates the stock’s risk compared to a safe investment and the market’s overall volatility.
Here’s how we figure out the cost of equity for MUNJALAU.NS:
cost_of_equity (19.00%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (1.29) + risk_adjustments (0.25%)
We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.